Microsoft’s Deadline To Yahoo Passes. The Beginning?
(Rate this article)
Loading ...Email It!
Following Yahoo’s statement that characterized the Microsoft’s bid for Yahoo as undervaluing the company, Microsoft has issued a deadline for Yahoo to act on the offer till April-26. The deadline has passed this Saturday without a word from either of the camps. Microsoft has threatened for (a.) Lowering the bid, or (b.) Walking away from the offer. Well, the scenario (b.) seems like an ideal situation that Yahoo might have dreamt of. But it’s actually a nightmare. Let me tell you why. If Microsoft walks away from the deal, thousands of shareholders of Yahoo will be furious since they failed to get a justified price for their holdings in Yahoo. (Yes, many of the shareholders think that at $31 per share, Microsoft is offering a fare price to Yahoo). This, as we discussed in our featured post Microsoft-Yahoo-Google : Kuchh Kuchh Hota Hai, could result in a shareholders’ rebellion. Some of the shareholders have already threatened to sue Yahoo for failing in their duty to maximize the shareholders value.
Chris Liddell, Microsoft chief financial officer said on Thursday that Microsoft is standing by the April 26 deadline.
“With respect to Yahoo we have been clear: Speed is of the essence. The idea we should increase our bid just because we can afford to is not one that I favour. Unless we make progress with the Yahoo board by this weekend, we will explore our alternatives.”
Liddell’s comments echo those made by Ballmer earlier in the week.
“We have a strategy for the Internet that we are very excited about. We think we can accelerate our strategy by buying Yahoo and we will pay what makes sense for us to pay for our shareholders.”
Yahoo has been trying to avoid falling into Microsoft’s kitty for a while now. It even attempted to forge an alliance with Google to let Google put search ads own its own website. Even a deal with AOL was heard of. But nothing has materialized so far.
Passing of the Microsoft’s deadline might be seen as the start of Microsoft’s serious efforts in taking over Yahoo. I expect Microsoft to go all out and open its offer to the shareholders. If that happens, I don’t see Yahoo having many options. A hostile takeover can be avoided, however, Yahoo’s board seems adamant on its current stand.
What do you guys think of the deal? Should Yahoo accept Microsoft’s offer? Or will Microsoft take over Yahoo anyways? And, most importantly, what implications can it have for the end consumers? Looking forward to our readers comments.
Loading ...
Leave a Reply